China's Marxist communal farming makes way for agribusiness

By Michael Meyer

Mar 20, 2015 | 9:20 PM

This 2013 photo shows the Shenzhen River, which separates the high-rises of Shenzhen, China, from farmland in Hong Kong. China has come under criticism for the amount of agricultural land it has paved over in its push for economic development. (Brent Lewin / Bloomberg)

In a northeastern Chinese village called Wasteland, elderly Auntie Yi frowned at the latest improvement there: a strip of grass lining Red Flag Road. “The company did this,” she scoffed. “Eastern Fortune Rice widened the road, it put up the streetlights and it dug up the poppies I had planted with my own hands and seeds in favor of this.” She kicked at the sod. “My poppies were orange and yellow and red.” Then, pointing to the jade ocean of rice paddies all around, she added, “This is just more green.”

China faces daunting farm statistics: One-fifth of the world's population feeds off one-twelfth of the planet's arable land. And that acreage is shrinking: In the last 30 years, an area the size of New York state has been paved over as China urbanized. An additional 8 million acres became so polluted that the government announced in late 2013 that they shouldn't be used for agriculture.

China's solution is to industrialize farming, as the United States did in the last century. (In 1935, America had 6.8 million mostly small farms; today it has 2.2 million, and just 9% of them produce 66% of America's crops.) In February, when the Communist Party released its policy blueprint, the “No. 1 Central Document,” for the 12th year in a row, it focused on rural reforms. The government is promoting the consolidation of family-farmed plots into large-scale, managed enterprises. In a word: agribusinesses.

Until recently, the privatization of Chinese farms was anathema; the party came to power on a mantle of equitable distribution of land seized from manorial estates. (In the 1950s, about 800,000 landlords were executed.) Today, farmers are allotted a plot about the size of an American football field but are barred from owning it outright. Yet the government is telling them that privatizing farms is a national priority, so long as companies, not individuals, manage the land. As one elderly Wasteland farmer who has lived through six decades of economic experimentation fumed, “Someone up here,” he said, raising his arm, “is always telling us down here what to do.” In feudal times, it was landlords. Then came cadres. Now it's managers at Eastern Fortune Rice.

Most of China's agribusinesses are locally owned, but foreign investors are seeding the market too. In rural Anhui province, the American company Cargill recently opened an operation named Site 82 that breeds, slaughters and processes 65 million chickens a year. “Peanuts on the scale of China,” according to its manager. In the country's northeast, China and Singapore are developing a joint Food Zone project on a planned 500 square miles — that is, a superfarm the size of Los Angeles.

Auntie Yi bristles at such developments. In her padded silk jacket, cloth shoes and a bucket hat she looks like a hip art teacher, but Auntie Yi was once a village cadre whose politics were forged in this region, formerly known as Manchuria. After the Chinese civil war, when she was a young woman, farmland was parceled out to poor families such as her own. They dug rice paddies by hand from soil as rich and saturated as spent coffee grounds. “This is our village,” she told me. “And we can take care of it ourselves.”

But can they? For all their early pioneer spirit, the older generation has passed down a disdain for farm work. Children in Wasteland are urged to study instead, and test into a university. There is no equivalent of a 4-H Club. Nor is there talk of contributing to the collective village good.

China has now spent more years dismantling a Marxist society than building one. After Mao Tse-tung died in 1976, so did his diktat of communal farming. By 1984, families could grow and sell their own crop in exchange for handing a portion to the state, on plots guaranteed for 15 years, a period extended to a maximum of 30 years in 1993. Mandatory grain procurement ended in 2001, and all agricultural taxes were abolished in 2006.

So Wasteland's farmers have enjoyed nearly a decade of freedom to plant and sell as they wish. As a result, the village is comparatively prosperous, with garden-fronted homes and a road that used to be brightened by a planted strip of poppies.

Auntie Yi pointed to the tallest structure between her house and the foothills: an Eastern Fortune billboard. It commands: BUILD THE NORTHEAST'S TOP VILLAGE. “All we hear is develop, develop, develop,” she said. “But how do you know when a village has developed just enough?”

After Eastern Fortune paid for the road to be widened, next came a horizon of cranes building walk-up apartments. These the company offered to farmers in exchange for their homes, so it could tear them down and plant rice there. Rumors circulated that Eastern Fortune even planned to rename the 300-year-old village — after itself.

But Wasteland is already a company town. Eastern Fortune offers farmers an annual payment to sublease their land and sell the harvest. The rate is 50% higher than the average Chinese farmer's annual earnings of about $1,580. But with prices for everything in China rising, contracting one's land for the stipulated three-year period means betting against the market. It also means losing a house's garden and chicken coops that provide secondary income, as well as food for the family table.

“The government expects companies to lead the ‘backward' peasants to change,” Auntie Yi fumed. Perhaps the old party official in her missed shouldering that responsibility? But whereas many in Wasteland eagerly leased their land and moved into the apartments, the holdouts — mostly older, lifelong farmers — want stronger legal protections so they won't be coerced into signing the agreement. They want the freedom to sell, mortgage or invest in larger farms and better acreage — not unlike the way urban Chinese can play the real estate market.

Yet in Beijing, any talk of privatization for individual farmers has been muted or denounced as unconstitutional because by law the state owns all land (but not individual houses). Top officials are unabashed in their support for privately managed farms, however. A billboard in Wasteland showed then-President

Hu Jintao

smiling not with a group of farmers in the field, but with a group of managers at the headquarters of Eastern Fortune Rice.

For Chinese New Year this year the company gave farmers an oversized calendar with photos of its threshers and mechanized rice polishers. The calendar also holds traditional couplets, such as the New Year's saying:

Reflect on the past months/and sign contracts at once

.

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To Auntie Yi, that sounded pushy, even in verse. She refused to move into the new apartments and wept the day the digger arrived to tear out her poppies. A week later, the night after workers lay the sod, Auntie Yi lodged her protest. Under cover of darkness, she eased down on her elderly knees and planted twice the poppy seeds as before. Come springtime, her patch of Red Flag Road will bloom a riot of color once more.

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Michael Meyer is the author of "In Manchuria: A Village Called Wasteland and the Transformation of Rural China."